Ringgit Extends Gains Against US Dollar At Open | Money
KUALA LUMPUR, December 1 – The ringgit extended yesterday’s gains to open higher against the US dollar today as the greenback continued to weaken in response to a statement by the US Federal Reserve (Fed) .
The market had taken note of the speech by Fed Chairman Jerome Powell, who indicated that higher and lasting inflation was a real possibility, brokers said.
At 9 a.m., the local note stood at 4.2020 / 2065 against the greenback of 4.2025 / 2055 at yesterday’s close.
Bank Islam Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the US dollar had weakened despite Powell’s hawkish tone when he debriefed the Senate Banking Committee, which said the process reduction could be accelerated if economic data points to a more sustainable recovery.
âThe Fed chairman, however, has warned as scientists learn more about the latest variant of Covid-19.
“This means they could change course if the latest variant turns out to be more harmful and transmissible,” he told Bernama.
Mohd Afzanizam said the US dollar index (DXY) had corrected quite substantially, falling below 96 points, and added that the ringgit is expected to remain well supported, building on the latest greenback depreciation.
âThe way we see it is a technical correction following the US dollar overbought condition,â he added.
ActivTrades trader Dyogenes Rodrigues Diniz said the US dollar fell sharply against the ringgit on Wednesday, noting that the bearish tone was expected after the broad bullish move that began on November 1.
âFrom a technical standpoint, if the pair fails to break the support at 4.1940, there is a good chance that the US dollar will resume its bullish trend in the next few days.
âIf the price drops below 4.140, the next big support area will be around 4.1050,â he said.
The local rating also traded mostly higher against a basket of major currencies at the opening, with the exception of the Singapore dollar.
It rose against the British Pound to 5.5874 / 5934 from 5.6158 / 6198 at Tuesday’s close and improved against the Euro to 4.7613 / 7664 from 4.7753 / 7787 yesterday.
The ringgit also rose against the Japanese yen at 3.7107 / 7150 from 3.7230 / 7260 yesterday, but depreciated against the Singapore dollar at 3.0784 / 0821 from 3.0743 / 0769 previously. Bernama